USF asked to refund $6 million to federal government

The University of South Florida entrance in Tampa, Florida. (Chris Livingston/Getty Images)

The University of South Florida was asked to refund more than $6 million to the federal government after an investigation by the Department of Health and Human Services regarding the school’s high level of funding.

The HHS’ Office of Inspector General concluded the school did not claim costs in compliance with federal guidelines. USF claimed reimbursement for approximately $198 million in costs incurred from Oct. 1, 2009, to Sept. 30, 2011, on 302 grants contracts and awards. According to the report, many expenses were improperly documented or misspent on salaries and equipment purchases.

The office released the report on April 25 recommending the university refund $6,467,290 to the federal government and “enhance oversight of charges to Federal awards to ensure consistent compliance with Federal regulations.”

Adam Freeman, media coordinator for USF, says the university is working with HHS to resolve these concerns and lower the suggested refund.

“The university expects the final amount of the unallowable items to be significantly reduced once the audit process is concluded,” Freeman wrote in an e-mail.

As for students at the university, the issue is excusable to some and worrying to others.

C.J. Brown, a senior studying international studies at USF, calls the mishap “typical of big bureaucracy. “ At the same time, the 25-year-old says he isn’t criticizing his school too harshly.

“Clerical errors happen all the time,” Brown says. “It’s six million yeah, it’s a lot, but it’s not the end of the world.”

Melissa Pocius, a senior finance major at USF, heard the news through Facebook and says it’s a “big red flag,” and that she’s surprised it wasn’t more prominent in the news.

“I saw this posted once, and no one was really talking about it,” says Pocius, 23. “I feel like — and I could be completely wrong — I feel like they’re trying to hide it.”

Working parttime as a compliance analyst at Busch Gardens, Pocius says mishandling of money can be a firing offense no matter the size of the organization.

Along with the high level of funding, findings from the HHS Office of Inspector General and the Florida Auditor General sparked a review of USF’s transactions.

During the review, the audit covered a combined $24.8 million in salary and non-salary transactions for the 2010 and 2011 fiscal years.

Investigators selected random samples of USF’s transactions to see whether they were “properly approved, valid, reasonable or necessary.” The final results found one half of salary transactions and 40 non-salary transactions that were not allowed.

Other violations included transactions for general use supplies such as toner, computers and tablet computers.

USF is not suspected of intentional misallocation or criminal activity. “The problem was weak internal controls,” according to Katherine Harris, a representative for the Office of Inspector General.

USF is not the only school to come under the office’s scrutiny.

State University of New York and Florida State University faced inspections in 2011. In 2009, The Ohio State University, Dartmouth College and State University of New York were under review. Duke University was also questioned in 2009.

As a recommending organization, the office cannot punish the university if it does not comply. In such a case, National Institutes of Health will decide how to proceed.